Report: MG Rover Plans Headed for UK Pension Agency

July 12, 2005 ( - Britain's new Pension Protection Fund (PPF) appears poised to take over the pension plans of the collapsed MG Rover Group, according to reports.

The head of independent trustees of the group’s two pension plans, Chris Martin, said he expected to receive confirmation that they would benefit from the PPF within the next few weeks, according to the Sunday Post Online news report.  Martin told the newspaper that pension entitlements were being scaled back before entry into the fund, which pays a maximum of 90% of an individual’s pension.

Martin said the trustees were still negotiating with Rover’s former owner, Phoenix Venture Holdings, for it to pay further amounts into the plans.  But he said it was unlikely that money retrieved from Phoenix would come anywhere near filling the £495m gap in the plans’ books.

“We need to conclude our discussions with Phoenix Venture Holdings over the amount of debts they pay to the schemes,” Martin told the newspaper.  “Once that is concluded and the debts paid, we understand the government will clarify the entry requirements for the PPF and we will be able to enter the PPF from September or October.”

He said it had been decided that it was better to make a single adjustment now to bring entitlements in line with what would be expected under the PPF.

The agency, which is the UK’s equivalent to the PBGC opened for business in April this year (See  Britain’s Answer to PBGC Opens for Business ).